Monday, March 5, 2007

A New Kind of Home Searching Emerges: Streaming Videos Begin to Shape the Industry

One aspect of real estate that has been increasing in popularity over the past few years has been the resources available to homebuyers through the Internet. Although real estate professionals have not yet fully adapted to the changing market, a recent development is showing that they might be catching up quickly. A small part of the industry is beginning to follow the lead of sites like YouTube, who have taken the world by storm with their vast array of streaming videos. Charlie Young, the vice president of marketing for Coldwell Banker said, "I believe streaming videos on Web sites is the wave of the future." With the introduction of web sites specializing in streaming video home tours and many other features, as can be seen in the picture to the left, it looks like the future might involve an easier, more convenient means of home searching.

There are many different methods that companies can use in order to take advantage of the Internet's role with homebuyers. According to an article by Les Christie, a staff writer at CNNMoney.com, one residential development in Delaware "has begun using high-quality, television news-style presentation to sell homes. On the site, viewers take interactive tours of the property, led by two on-line hosts, through different site channels." The development, Peninsula on Indian River Bay, is showing that features like online video tours do not necessarily mean that information or personality have to be lost. In the article, Christie says the site leads “users through a virtual tour of the development's offerings, including its neighborhoods, home styles, nearby beaches and features and amenities, including a Jack Nicklaus designed golf course.” This site makes the home searching process much more interesting for homebuyers, and could have an effect on the future of the industry.

One reason why this system will play an important role in the future of real estate is the convenience that it offers. Such features as video tours, floor plans and an almost unlimited amount of photos make searching for homes much easier. If homebuyers cannot find the time to look for homes, or have no means to travel across the country if they plan on moving longer distances, then the availabity of these resources on the Internet can be of great aid. An article by Manufacturing Talk, the number one production news source, says “The tremendous confidence buyers get through this type of interaction has lead to an increase in purchases 'sight unseen' from across the country, and the globe. Buyers know in advance that their furniture will fit in the desired space, and exactly what remodeling, if any, they want to have done even before they move in.” Offering such in-depth services gives homebuyers opportunities that would have seemed impossible only a few years ago.

Another reason why this could soon become a valuable part of the industry is the amount of portability offered through this technology. There are a number of gadgets, such as the one shown to the right, that can give homebuyers the information they need even if they are away from their computer. The iPod is beginning to play an important role with this too, as video podcasts are being used to give homebuyers video tours on the go with little or no information lost. Russell Shaw, a contributing writer for ZDNet.com, says in his post “Four Reasons Why Every Realtor Needs To Video Podcast” that “Home-selling (and buying) is a visual medium. Homes, and in many cases the accompanying land, are best described through visual means. Video podcasts are ideal for walk-through tours that up until now, have been mainly illustrated either via photograph-based virtual tours or slide shows.” Podcasts offer the real estate industry a combination of portability and knowledge that cannot be matched by any other means.

One downside of this technology could be an increase in the gap between large and small companies. Larger organizations such as Century 21, Coldwell Banker and Re/Max are putting a lot of their resources into making sites that offer streaming videos. With a lack of resources or capital, smaller companies might not be able to offer most of these services, or at least not offer them as comprehensively. Most of these features do not require too much capital, but they do require quite a bit of time and energy. If smaller companies want to continue to compete with bigger ones, they might have to sacrifice some of their initial profit and increase spending on the Internet.

Though it might hurt smaller companies, there is no strong argument that can be made against incorporating such features into the industry. The Internet allows real estate professionals to reach a larger number of potential homebuyers at a relatively low cost, and there is no question that it makes researching easier. It looks like the real estate industry as a whole might soon begin to take full advantage of the Internet. The demand and technology are certainly there, but real estate professionals need to start utilizing this opportunity, or they could soon end up without a job. In the words of Christie, “Today, if your site doesn't offer virtual tours, mapping technology, neighborhood guides and a video library of buying and selling tips, it's nowhere.”